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Industry Briefs
New Consumer Protection Rules For Airline Passengers
Matt Thomas

Effective Tuesday, August 23, new federal rules were implemented to provide greater compensation if fliers are bumped off flights, make airlines better disclose extra fees and to prevent long tarmac delays for passengers.

The Transportation Department’s consumer protection rules will:
  • The Department of Transportation (DOT) will be able to impose fines on U.S. and foreign airlines of up to $27,500.00 per passenger if they leave an international flight on a tarmac for more than four hours without taking off. A jumbo jet could be liable for up to $11,000,000.00
  • Raise compensation if passengers are bumped from an oversold flight. A passenger would get double the price of their tickets up to $650.00 if their arrival at their destination is delayed just a few hours. Currently, compensation is equal to the ticket value, up to $400.00. A passenger experiencing longer delays would trigger payments of four times the value of their tickets, up to $1,300.00. That compensation is currently capped at $800.00.
  • Airlines would be required to prominently disclose all ancillary fees on their websites, including fees for providing meals, checking bags and cancellation of reservations.
Although consumer advocate groups welcome the new rules, the airlines say more government regulations will hinder their operations. Steve Lott, a spokesman for the Air Transport Association that represents major carriers, states, “Market forces, not additional regulations, are already providing customer benefits. But Kevin Mitchell, chairman of the Business Travel Coalition says, “The new rules on balance are good and sweeping.

Beginning January 24, 2012, the DOT will require the airlines to adhere to the following additional provisions:
  • Allow customers to cancel reservations without payment for at least 24 hours, if the reservation is made at least a week before departure.
  • Promptly notify passengers at the boarding gate, on airline websites and via their phone reservation systems of flight cancellations and delays of more than 30 minutes.
  • Include all government taxes and fees in advertised fares. Most airlines currently exclude those fees.
  • Not raise a fare after a ticket has been bought unless it’s a result of government applied taxes and fees, and the flier agrees to the increase.
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